Under section 24(b) of the IAA, a court can set aside an award if there has been a breach of the rules of natural justice in the making of an award which has then prejudiced the rights of the aggrieved party.1
In a 2001 case,2 the Singapore High Court set out the elements that need to be established to set aside an arbitral award for breach of natural justice:
a which rule of natural justice was breached
b how that particular rule of natural justice was breached
c in what way the breach of natural justice connected with the making of the award
d how the breach prejudiced the rights of the party concerned.
This test has been applied and approved in subsequent cases.3
The Singapore courts adopt a test of actual or real prejudice to the aggrieved party in the making of the arbitral award – a lower threshold than the test of ‘substantial prejudice’ in the English Arbitration Act 1996, for example.
The application of the test for breach of natural justice is best enunciated by the Court of Appeal in L W Infrastructure (at ):
‘the real inquiry is whether the breach of natural justice was merely technical and inconsequential or whether as a result of the breach, the arbitrator was denied the benefit of arguments or evidence that had a real as opposed to a fanciful chance of making a difference to his deliberations. Put another way, the issue is whether the material could reasonably have made a difference to the arbitrator, rather than whether it would necessarily have done so.’